Inequality persistence in Mexico, 1940-2015

Abstract

This work examines the inequality persistence in Mexico using unit root and stationarity tests. Inequality is measure by constructing the Theil index for México, from 1940-2015, and separating the states in Mexico by regional convergence clusters in addition to decomposing the theil index for inequality within and between the clusters. Results suggest that its no possible to reject the null hypothesis for non-stationarity as well as rejecting the null for stationarity depending on the test. Furthermore, structural breaks were considered and tested. The test shown persistence on inequality for the majority of the variable for inequality in Mexico in the last 75 years.